WHAT IS THE FORECAST POLL AND WHY TO USE IT?
The Forecast Poll is a sentiment tool that highlights near and medium-term price expectations from leading market experts. It is a sentiment indicator which delivers actionable price levels, not merely “mood” or “positioning” indications. Traders can check if there is unanimity among the surveyed experts – if there is excessive speculator sentiment driving a market – or if there are divergences among them. When sentiment is not at extremes, traders get actionable price targets to trade upon. When there is a deviation between actual market rate and value reflected in predicted rate, there is usually an opportunity to enter the market.
You can also use the Outlook Poll for contrarian thinking strategies. Gonçalo Moreira, Research expert at FXStreet, explains: “People involuntarily follow the impulses of the crowd. Sentiment indicators, in turn, lead to 'contrarian' thinking. The prediction helps traders detect sentiment extremes and thereby limit their eventual toxic herd behavior.” Read more on Contrarian Approaches with Sentiment indicators
HOW TO READ THE GRAPHS?
Besides the table with all participants’ individual prediction, a graphic representation aggregates and visualizes the data: the Bullish/Bearish/Sideways line shows the percentage of our contributors on each of these outlook biases.
This graph is available for each time horizon (1 week, 1 month, 1 quarter). We also indicate the average price prediction as well as the average bias.
2024 FORECAST FOR GBP/USD
In the GBPUSD Price Forecast 2024, our analyst, Dhwani Mehta, notes there are plenty of unknowns and looming uncertainties that make it difficult to convincingly predict the course of the Pound Sterling against the USD in the year ahead. On both sides of the Atlantic, increased odds of a recession, a dovish pivot in the monetary policies and general elections are foreseen as the key factors driving the GBP/USD price action next year, barring any unprecedented geopolitical risks. Read more details about the forecast.
GBP/USD witnessed a rollercoaster ride in 2023 but the Pound Sterling managed to preserve the recovery gains seen in the first half of the year to a 15-month high of 1.3142.
MOST INFLUENTIAL POLITICAL EVENTS IN 2024 FOR GBP/USD
BoE policymakers continue to push back against expectations of rate cuts next year. However, deteriorating economic performance prompted money markets to begin pricing in four 25 bps rate cuts starting from the summer, anticipating the key rate to be slashed from 5.25% to as low as 4.25% by the end of 2024. The first cut is expected as early as June, to 5.0%.
A general election is expected next year in the US and the UK, which could fuel intense volatility around the GBP/USD pair.
BONDS THAT INFLUENCE THE MOST GBP/USD
Bonds whose moves can impact the GBP/USD pair: T-BOND 30y; T-NOTE 10y; GILT 30y; BUND 30y; JGB 30y - GBP/USD traders should closely watch when trading it: UK 2y Gilt, UK 5y Gilt, UK 10y Gilt, UK 30y Gilt. This group also includes the following currency pairs: EUR/USD, USD/JPY, AUD/USD,NZD/USD, USD/CAD, EUR/GBP and USD/CHF